BitcoinBTC priceCointelegraph.comKimchi premiumSouth Korea

Kimchi premium collapses: Short-term top signal or a reset for Bitcoin?

South Korea’s Kimchi premium collapsed overnight, but it is likely not a sign of a short-term Bitcoin top.
The so-called Kimchi premium, which measures the premium of the Bitcoin (BTC) price in South Korea’s cryptocurrency exchange market, plummeted overnight.The premium declined from 22% to 15% within a matter of hours on April 7, and it is continuing to drop across major South Korean exchanges.BTC Korea Premium index. Source CryptoQuantA big pullback in South Korea’s Bitcoin marketOvernight, as CryptoQuant CEO Ki Young Ju noted, the price of Bitcoin fell particularly hard on South Korean exchanges.As the price of Bitcoin dropped, the Kimchi premium fell in tandem. But, since BTC price fell significantly harder on South Korean exchanges, the premium plunged quickly within a matter of hours.Bitcoin falls hard on South Korean exchanges. Source: Ki Young JuThere are two possible reasons why the premium dropped in the manner that it did.First, traders from outside of South Korea might have found a way to successfully arbitrage the premium. One potential way this could happen is if traders from other Asian markets coordinate with whales in South Korea to sell BTC and withdraw on the same day.Second, altcoins that were increasingly gaining momentum throughout the week severely corrected. As the capital from the altcoin market exited, traders might have also sold BTC and ETH, bringing down the large-cap cryptocurrencies.Ki said:”It seems someone finally figured out how to arbitrage this Kimchi premium opportunity. The trading volume in 30min time frame …
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